EU parliament shelves NGO funding proposal

Staff with the Danish Refugee Council, DRC, distribute aid to Syrian refugees in Kilis, Turkey. The Danish Refugee Council is the largest NGO recipient of EU funds. (Photo: European Union/ECHO/Caroline Gluck)

The European Parliament has postponed a report that aimed to step up scrutiny on the EU's financing of NGOs, after Hungarian prime minister Viktor Orban compared it to a controversial Hungarian bill.

The coordinators of the budgetary control committee decided on Thursday (4 May) to ask the European Court of Auditors for a special assessment regaring EU funding of NGOs before proceeding with the report.

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Markus Pieper, a German MEP from the centre-right EPP group, headed the file, which wasn't binding but aimed to ask the European Commission to impose stricter controls on charities and the way in which they spend EU funds.

Pieper's office declined a request to comment.

But Petri Sarvamaa, a Finnish MEP and EPP coordinator in the budgetary control committee, told EUobserver that Pieper had volunteered to write the report "after running into things that caught his attention in the NGO world" whilst he was writing the parliament's discharge report on the implementation of the EU budget of 2012.

"Through his report, we wanted to have a closer look at how taxpayers' money is being used," Sarvamaa said.

The Finnish MEP added that some NGOs communicate in a way that is "sometimes biased or even twisted to serve political ends", although he didn't specify to which organisations he was referring.

The draft report called on the EU to cut funding for NGOs that “demonstrably disseminate untruths” and whose objectives are "contrary to the fundamental values of the EU, democracy, human rights and/or strategic commercial and security-policy objectives of the EU institutions".

Pieper, in his draft, also suggests the European commission could help to improve transparency by putting in place a single system for recording and managing grant funding.

There is currently no common definition in the EU of what makes a non-governmental organisation; different directorates-general have varying rules on fund-seekers, making it difficult to get a clear overview.

The European Court of Auditors, which is more of an auditing body than an actual court, usually takes 1-1.5 years to complete a probe. This means the report could return to the EU parliament's agenda during the current mandate, which ends in July 2019.

"I am all for transparency," he told EUobserver, "but from the very beginning, this report was suggesting NGOs were not transparent enough without being able to back it up by evidence."

"Although the file wasn't legislative, it would have sent a strong political signal, if adopted, that the European Parliament finds NGOs lacking in transparence," Javor said.

The Hungarian MEP added that he recognised this kind of reasoning on NGOs from his native country.

Recently, Hungary has been pushing ahead with a law that would force NGOs to register as "foreign-funded" if they receive more than €23,000 a year from abroad.

MEPs, during a plenary debate last week, scolded Hungary's prime minister, Viktor Orban, over the NGO bill. However, Orban struck back by comparing his country's draft law to the parliament's report.

"In the Pieper report here, in parliament, you are also dealing with the complicated question of how to make the operation of capital-intensive foreign lobbying that aims to influence democratic decision transparent for everyone," he said.

Following these remarks, Markus Pieper suggested in an email to coordinators that his report should be postponed by three months to separate it from the Hungarian bill.

Javor argued there were maybe areas in which NGOs could improve their transparency, "but they are already more transparent than MEPs", and suggested that vague allegations only breed suspicions against civil society.

Sarvamaa disagreed with the idea that the parliament was rushing into a report without sufficient proof, and said there was nothing peculiar about the postponement.

"I fiercely reject the notion that we should have all the facts on the table before starting our work. I was a journalist for 25 years, and the more I worked on an issue, the better my facts were," he said.

"The time-out doesn't mean that we don't want to look at [NGO financing] in the future," he added, indicating that the file could be reopened.

The EU has no specific figures on how much it spends on NGOs. However, a parliamentary study said the 28 biggest NGO recipients were earmarked €610 million in 2015, although it is not yet known how much of this was actually handed out.

The biggest benefactors were the Danish Refugee Council, Save the Children Denmark and the Norwegian Refugee Council.